Mason: Welcome back to another edition of Small Business Spoonfuls. My name is Mason, and joining me once again, as always, my co-host Lisa Smith. Lisa: Hey Mace. How's it going today Mason: Going pretty good. Going pretty good. We, you know, been taking a little bit of, you know, time here and there and, but, things are going pretty good overall. How about you Lisa: Oh, yeah. Really, really well. Thanks for asking. We've been finishing, or not finishing, but we've been, doing an HR study group, every Thursday night. And so we've got this great group of, of HR Pros and we are breaking down the topics and it's super fun. So I've been really focused on that. and, but yeah, it's, it things are going really well. Mason: Yeah. That's awesome. No, actually, while we're on that subject, this wasn't planned by any means or anything like that, but yeah, talk about that study group a little bit, because those are things you're gonna try to be, planning out, doing o over, you know, maybe a couple times a year or something. Lisa: Yeah. So what happened is I started getting a lot of people, you know, talking about wanting to do deeper dive conversations because, you know, we have the group called Boss Calls, and that's where we have two 90 minute, kind of like expanded webinars every month. So we do 24 a year is what we do. And so, you know, we have guest experts come on and talk about things, but I had some folks saying, you know, that's a pretty deep dive, but I would like to even go deeper on some of these subjects and really break it down. And also, I'm thinking about getting certified as an HR pro, so it would really help to like be able to dive in and know what to expect. And so while a lot of our folks in the group are not going to sit for a test, and they really just wanted the extra hr, education, if you will, but some of them are, and so this is kind of a common net combined group of people. Lisa: And I got enough of that feedback that I finally decided in the beginning of January I was going to announce, okay, we're gonna do 16 weeks. And so we started our 16 weeks at the beginning of February and we'll ended it up June 1st, and we meet once a week for an hour and a half. And it's a small group. I limited it personally to 18 people. and so that way we could all have freedom to speak and, and, you know, really get something out of it. And it has just been great. And, you know, I'm getting wonderful feedback from the attendees that they love it, you know, and so anyway, we're just gonna keep doing this. And, you know, probably in the spring, in the fall, maybe do a short session in the summer, so it won't be as in depth. But if you're looking for like a six week thing, you know, like, like a boot camp tape 16. Yeah. More like, a little bit more like a bootcamp. but at the same time, not simply focused on test taking Right. Really with the focus of just learning more about HR and what our job is. Mason: Right Yeah. And you know, we, we, the way you kind of teach things is in a more candid manners and you like to have fun with a lot of stuff. So it, it's not just like hitting the book and reading the book like this for an hour and a half. It's, you know, it's an engaging conversation that you're really, you know, wanting people to express and talk and really discuss the hard topic. So I think that's pretty cool. And yeah, Lisa: We basically have a signed reading every week. Yeah. And then we do a general conversation around that reading. So yeah, you're right. We don't go through it and say, okay, now on page 47, blah, blah, blah, you know, we're not gonna do that. Yeah. It's really a conversation, so, Mason: Which is really cool. So, and you know, whether, like you said, whether or not you're looking to take the test, this is a great almost semi collge course that's, yeah. That, you know, that is more, even more, discussive, you know, more, more discussion going on. So I, I just thought that was, you mentioned that. So I thought it'd be cool to just kind of promote that a little bit for people to look out for. Cuz we'll be looking for attendees later in the year as well. So Lisa: Yeah, reach out to us and let us know if you wanna be put on a wait list or something you can write, support at help desk for hr.com and say, put me on the wait list. I'll be happy to do that. Yeah, Mason: Yeah. Wait, wait, list for HR class, so Lisa: Yeah, hr, HR study group. Mason: Yeah, exactly. So, yeah, well that, that was a nice little, primer for that. But yeah, let's get into our topic today because , our, our, we, we like to come up with really, clever, podcast titles, so people might not understand what exactly we're talking about today. So why don't you get into that, Lisa Lisa: Okay. So at the end of our last podcast, I teased that today's subject would be naughty girls need minimum wage in overtime too, . And so, and then, and you said Mason, you were really traumatized by that title, so I apologize. I'm Mason: Still traumatized. Yeah, Lisa: . But what we're talking about today is, a case that, and, and there there have been multiple cases like this okay. That the Department of Labor has ruled on and that have gone to court and so forth, revolving around exotic dancers. So, you know, women and men who dance in clubs and sometimes they're partially nude, sometimes they're fully nude, but nevertheless they're classified under exotic dancers. and they are very often treated as independent contractors by the owners of these clubs. And so they're paid on a 10 99 basis and, you know, they handle all tips on 10 99 and all of these sort of things, right And so several years ago, the, the, the Department of Labor started getting complaints and started to research this industry and found out that these dancers did not qualify as independent business owners. Instead, they were truly employees of the club. Mason: Interesting. Yeah. So it's the age old case again of, you know, we talked, we've talked about this a lot before of independent contractor versus employee and before we, before we go any further, I just wanna put up a disclaimer for people that we are not abdicating for or against this type of work where we're just stating the case and what's going on. So we just wanna get that out there, you know, we're not promoting whatever or against it. So, you know. Lisa: Yeah, you, my, my title was really, you know, naughty Girls. My title is a throwback to, if you know anything about the eighties and nineties music, there was an artist by the name of Samantha Fox, and she had a song that was extremely popular and it was called Naughty Girls Need Love To. And so when I, when I heard about this, these cases and read through them, it just reminded me of that Samantha Fox song. And so I thought Naughty girls not only need love, but they need minimum wage and overtime Absolutely. Yeah. Which makes the point that no matter how your industry is perceived, whether it's perceived as pious or not, you know, you still deserve to be paid appropriately regardless of what you do for a legal living. Right. So, Mason: Exactly. So, so what, what's kind of the, the verdict and the repercussions of what's going on here Lisa: Well, so basically what happened is, the D O L came in and required a lot of these clubs to go back three years and calculate all of the hours that the dancers had worked, and then look at how much money the dancers had received for that work. And in some cases, you know, the tips were taken by the club, or part of the tips were taken by the club, which was also a violation Yeah. Of the statutes. And so they were required to go back three years and l look at what should these people have been paid, if they had been hired on as employees, and were there benefits that maybe w two employees for the clubs were able to access that the dancers weren't. And so there were so many violations here that for some of the bigger chains, it even added up to like ERISA violations, which, you know, an ERISA lawyer is like a thousand dollars an hour. Yeah. And basically ERISA is just everything guiding retirement benefits and all of those types of things. And so, so these folks were deprived not only those benefits, but they were deprived, affordable Care Act, benefits, and all sorts of laws were being broken. Maybe family and medical leave act, you know, coverage. There were just, there was this one thing after the next that started to pile up. And so some of these chains were charged millions of dollars, that they had to come forward with, not only in back pay, but in penalties and fines. Mason: Yeah. Yeah. And that's, I mean, I don't care what kind of business you're in, when you're going, when you're looking at close to 6 million that you're gonna have to pay, from, you know, years and years of doing something wrong, that's a lot of money. That's, you know, and that's gonna, that shuts businesses down in a heartbeat. Lisa: So It is. And, and so, but so what, what is the obvious question here What was the dividing line Why were they not independent contractors Right Yeah. And so the main thing was, is that they weren't independent business owners. They were dancing. Yeah. They were dancing for the club, and they were told by the club when to show up and when to leave Yeah. And what to charge for, you know, the v i p room and you know, blah, blah, blah. Mason: Yeah. A lot of times their tips were taken too. Like you said, that's a violation. you know, yes. So the tips were taken and calculated into the money and run through the club and all that kind of stuff. Lisa: So, yeah. And so they, they literally were not running a dancing business where they went from club to club independently dancing. And, you know, it, it doesn't work like that in that industry. . Yeah. And so, like, the Department of Labor really blew the lid off of that. And, and it, this was a longtime practice. So that was also a lesson to employers who say, well, this is the way we all have done it. Always done it. We've never been fined before. Well, just because you weren't fined for the last 50 years doesn't mean you're not gonna get fined this year. And, you know, because sometimes things just turn on a dime and things and, and practices that the Department of Labor or the I r s have not dug into and enforced, you know, for years, it, that it doesn't mean they don't reserve the right to suddenly start doing it. And that's what happened to these clubs is that they had been doing it a certain way forever, and nobody had said anything to them, and then suddenly they were getting hit with millions of dollars of fines and penalties and back pay. And they were like, what For years, you've never said anything to us. And that doesn't matter. Doesn't matter. It's the, it's the employer's job to do it. Right. It's not the DLL's job to knock on your door every six months and say, are you doing it right Mason: Yeah. It, I almost look at it like when you're doing something wrong, and under the table, kind of like that, it, you, they may not even know, have known it was a hundred percent wrong, but they just weren't educated. But it's almost like playing a game of Russian roulette. You, you know, you spin the barrel every year and see if you're gonna get audited or something's gonna get looked into or somebody's gonna file a claim or something. It's, it's like, and if, if that gun is loaded with that, with that bullet, you're gonna get shot and it's not gonna be good. So, you know, it's just a , it's a, it's a fine line you walk and the, we've heard rumblings that the d o L is gonna be even cracking down even more on this subject, haven't we loose them Lisa: Yeah. The Department of Labor is issuing some new rules probably in the next few months, and we're gonna see how they, how strict they are, but from what it looks like right now, they're going to be pretty strict. Yeah. And so, we'll, we'll just have to wait and see. Mason: Yeah. And it, when that stuff comes out, we'll for sure do another podcasts and kind of update everyone on that. But what can people do in the meantime if they're looking, you know, kind of, if they have a situation where it's kind of unclear Lisa: Yeah. In the meantime, you know, reach out to your local attorney, reach out to, if you use, advisory service like helpdesk, for instance, help desk for hr.com, we do advisory services. We offer, tests and audits on classification not only of independent contractors, but of your exempt, non-exempt and, you know, other worker situations, get some help. You know, go to the Department of Labor's website and find out what the rules are in your state and then also federally and compare those. If you're in California, this is a major hot topic, New York State, New Jersey, like there are so many, anything New England, this, these are major hot topics. So don't just sit on your hands and wait for someone to come knock on your door because Right. This is something you have to be proactive on. Mason: Yeah. Right. And I'm gonna link in the, in the show notes here, to this article that we kind of took this off of our, off of one of our websites. And in, in that article, there's actually a free payroll audit checklist you can download off the article and look at and see, you know, that that'll kind of get you started, at least if you're, if you're looking into something like this. And we'd love to, for you to sign up for our services too. So, if you need some help with that kind of thing, that's what we're here for, to try to help people through things just like this. So, Lisa: Yeah. Absolutely. So, yeah, I think, you know, for the spoonful version of this conversation, that pretty much does it, but if you have questions, please always feel free to reach out because we're, you know, we're here to help. Mason: That's right. Absolutely. and then we wanna hear your feedback as well, so you can hit us on Twitter at help desk for hr, email us support, help desk for hr.com, and, write questions, suggestions, comments, you know, anything under the sun, that you wanna say about the podcast or ask us, or maybe even a topic that you might wanna hear us talk about. Yes. Lisa: But please suggest a topic Mason: , right. With topics in mind. what's our topic for next week, Lisa Lisa: Our topic is we're kind of jumping back to, ask HR support. And so the question is, my customer said their snake is a service snake. Is that a thing Mason: Ooh, okay. Oh, is the serpent a service Serpent, , Lisa: . Mason: That makes it sound even creepy. That sounds good. Okay. Well, like I mentioned before, if you wanna learn more about our services, go to help desk for hr.com. And, other than that, take us out, Lisa. Lisa: Yeah. So, you know, we always say you can't be audit proof, but if you follow the steps, take the advice and secure your practices, you can be audit secure. So until next time, be audit secure.